Universities Facing Twin Threats Of Covid And Brexit

14th June 2020

Minister tells UK Government that urgent support needed within days.

The double threat of coronavirus (COVID-19) and the potential loss of access to EU funding programmes could result in long-term damage to Scottish university research, unless the UK Government provides immediate financial support, according to Higher Education Minister Richard Lochhead.

The Scottish Funding Council's recent analysis suggests the country's universities will lose around £72 million in academic year 2019-20 alone as a result of COVID-19. An operating deficit of between £384 million and £651 million in academic year 2020-21 is expected, due largely to the likely dramatic reduction in the number of international students, a major source of income for research. Those reductions do not take account of the potential loss of EU funding.

As Scotland's university courts prepare to meet to discuss their financial predicament, Mr Lochhead has this weekend written to the UK Science Minister Amanda Solloway, insisting she urgently delivers a comprehensive package of funding for research to counter those twin threats, taking into account the particular interests of Scotland's universities.

Mr Lochhead has been participating in a UK taskforce - co-chaired by Ms Solloway and the UK universities Minister Michelle Donelan - to consider some of the financial and logistical challenges facing university research as a result of the pandemic, such as an expected loss in international tuition fee income, the potential loss of early career and experienced research talent, a reduction in business and charity funding, and delays in crucial research projects.

Mr Lochhead said:"It’s vital both for Scotland’s economic recovery and to protect the nation’s global reputation for science and research excellence that the UK Treasury signals substantial support for our universities in the coming days. The UK has aspirations of being considered a science superpower - but the institutions that can deliver on that are facing their biggest ever financial crisis. As well as several being seriously affected by COVID-19, they face potentially losing EU funding and talent as a result of a Brexit that the scientific community has said spells bad news for the sector.

"Many universities are, right now, having to make difficult strategic financial decisions about their future. In the current emergency, the continued lack of clarity over funding could very soon result in the direct loss of research talent, a reduction in our research capacity and the halting or cancelation of major capital projects, with a ripple effect on the wider economy and our future global research reputation and competitiveness.

"Scotland has already put together an emergency COVID-19 support package worth an additional £75 million for our university research sector. But this direct Scottish Government commitment - which has already been allocated - must be urgently complemented by a substantial UK element to ensure appropriate fiscal support is made available to Scottish universities.

"In addition, detailed arrangements following the end of the Brexit transition period are still unknown, such as whether the UK will associate to the hugely prestigious Horizon Europe research funding programme. The current programme Horizon 2020 has provided more than €536 million to Scottish institutions since 2014.

“The Office of Budget Responsibility highlighted in April that universities could be the sector of the economy worst hit by the pandemic so it’s now more critical than ever to announce as a matter of urgency a UK-backed stabilisation package for Scottish university research - a sector which most recently has been making such a vital contribution to our efforts to fight COVID-19, and our economic and social recovery from it."

Participation in Horizon 2020 has been incredibly valuable to Scotland, supporting growth by investing in research and innovation. Since 2014, over €711 million of funding in research and innovation has been competitively won by Scottish organisations, with universities securing almost 75% (over €536 million) of this. The funding won by Scottish organisations since Horizon 2020 began is around 11% of the UK’s Horizon 2020 funding (over €6.6 billion). Scottish universities receive an average of 8% of their total research funding from the EC - around £100 million per year mostly from Horizon 2020.